Chapter 16

Interaction of trusts with other policy areas

Conclusions

16.48We have reached the following conclusions:

(a)Trusts should continue to be addressed in individual legislative schemes, rather than in a central look-through provision in trusts legislation.(b)It may be appropriate for some other policy areas to have stronger powers to disregard dispositions to trusts or consider assets to be available to a person when they have beneficial interests, or effective control. Those developing or reviewing provisions may want to consider how they view dispositions to a trust, beneficial interests or expectations, and effective control.(c)While not recommending a general look-through provision in trust law, other aspects of existing trust law, which it is proposed to set out in trusts legislation, may be relevant. These aspects include the validity of the trust in question (courts can find no trust if it does not meet the three certainties) or the failure of the trustee to meet their obligations (for example, not considering all the beneficiaries, or allowing themselves to be directed by a third party such as the settlor).(d)There is a case for a specific reform to be made to provide that the Official Assignee has standing to challenge a trust regardless of whether the bankrupt could have done so prior to the bankruptcy.